patrick.net

The pensions simply are not real.

The pensions fund managers have about 25% of the money invested in Private Equity where the values are determined by the investment salesmen (what could go wrong?),

About 25% is invested in the stock market (I'm sure nobody thought about having to sell when the prices drop).

About 25% is invested in near junk bonds (yep in a downturn they will all collapse. It's a known systemic risk, but when the SHTF it will be "who could have possibly foreseen").

The other 25% is spread around in other high-leverage investments.

The people in charge of these investments are the same type of politicians in charge of helping the homeless.

Al_Sharpton_for_President says

Leave California.

Houston is going broke because of policeperson pensions as well. Good thing they cant jack up taxes as much as they want because State does not let them

DooDahMan says

Voting got us there and voting will get us out of there but not without a lot of pain and angst

Vote D - get Houston city council which gives trillion $$$ to "heroes in blue" running away from shooters. Vote R - get Ft Worth city council which does the same.

BayArea says

San Jose police paying $150k will fill the positions with or without pensions

It's not a living wage in SJ. That's why for the new hires / youngsters, we have mercenaries who commute in from afar. We are f*cked.

FuckTheMainstreamMedia says

Typical is raising the retirement age from 55 to 65 and capping retirement at 65-80% for new hires and that’s probably as good as you’re gonna get on this.

This is California friend. Classic CalPERs public safety employees get 3% at 55 year of age (with a 90% max cap). New PERPA CalPERS public safety employees get 2.7% at 57 years of age. Good deal for the taxpayers, right? Higher retirement age and lower percent. Well, get this. There is NO CAP. If you work 40 years (start at 22 years old and retire at 62 year old), you get 108% of salary.

AmericanKulak says

Big Forest Fires are very rare.

Nonexistent.

B.A.C.A.H. says

BayArea says

San Jose police paying $150k will fill the positions with or without pensions

It's not a living wage in SJ. That's why for the new hires / youngsters, we have mercenaries who commute in from afar. We are f*cked.

Police do that anyway because they don’t want to encounter criminals they deal with everyday while at the supermarket or the park with their family. It’s by design.

I have friends in the SJPD. They make well over $200k with a bit of OT, it’s all public info. Don’t tell me it’s not a living wage. They are also married to spouses that earn a living and live in $2M houses.

Please don’t cry for SJPD or SJFD wages because they are among the highest in the country. They make a Silicon Valley engineers salary.

"California’s total unfunded pension liability (aka pension debt) remains at more than $1.0 trillion, measured on a market basis; this translates into $77,000 per household.
In reality, the state’s pension debt is likely even higher since Pension Tracker assumes a 3.25% discount rate for liabilities, far higher than current long-term U.S. Treasury yields"

https://pensiontracker.org/

Some of these pensions are like winning the lottery:
https://transparentcalifornia.com/pensions/2020/

BayArea says

I have friends in the SJPD. They make well over $200k with a bit of OT, it’s all public info. Don’t tell me it’s not a living wage. They are also married to spouses that earn a living and live in $2M houses.

Yup. Police and fire fighters are substantially overpaid and their pensions are pure shit almost anywhere in the country.

Fact is once you're trained as a cop or FF, you literally do nothing. We just saw it in Texas with the school shooting. They literally did nothing for an hour when they knew children were being shot.

The only ones I respect are the ones working in inner city ghettos. They're fucking war zones in the bad cities. Talking cops. FF's can literally just let a property burn because they know they likely had insurance. They get to spray hoses and chop holes in the roof. Rarely is the Hollywood scenario of a FF running and saving babies happen. They either die of smoke or burn to death. 99% of FF's won't ACTUALLY risk their life. It's human nature.

Criminal. I NEVER thank any public employee for anything. I refuse to view public employees as even close to being good people. I've never thanked a soldier or any military person either. I make an exception for the old old guy military but, they're pretty much all gone now.

If we lose any more rights, tell me what good the military is to us.

"Hero" is code for we're a special class. Just like black, LGB, handicap, the offended etc etc etc. Every one of these classes of people fuck you all day long.

Yeah, some people who were like a fucking mechanic on a Destroyer in the North Atlantic 1968-1969 are the ones who are like "VIETNAM ERA VETERAN! GIVE ME FREE SHIT! LOOK AT MY NAVY BLUE CAP!"

Or "I WAS A SATELLITE DISH INSTALLER IN THE GREEN ZONE IN 2004! OPEN DOORS FOR ME! WHERE IS MY COMPLIMENTARY COFFEE?! LET ME TELL YOU ABOUT COMBAT, I HEARD A MORTAR SHELL LAND A MILE AWAY ONCE!"

I do thank WW2 and Korea Vets and actual Vietnam Combat Vets, the latter just out of respect for them putting up with a ton of Bullshit.

BayArea says

I have friends in the SJPD. They make well over $200k with a bit of OT, it’s all public info. Don’t tell me it’s not a living wage.

BayArea says

Please don’t cry for SJPD or SJFD wages

That is hilarious. I don't "cry" for them, as I said, it's not them who are f*cked, it's us.

My remark was about the new hires, not the ones in your / my age brackets who "locked in" their mortgage and Prop-13 a long time ago. Those homies will be retiring.

Like you, I am local kid who knows several police officers in SJPD. A reality that we ought to consider is that all but one of those I know, had to pay child support to one or more ex spouses for many years. This is an added expense to the Cost of Living. (The exception never got married, lucky him)

The starting base rate pay for SJPD, according to the City official website https://www.sjpdyou.com/for-applicants/additional-information/salary-benefits-pension is ..."...Annual base pay range for Police Officer of $105,726 to $164,150 (7 annual steps)..."...

It's plenty of money for those who locked in their housing cost a long time ago, avoided child support payments, did not make huge loans or HELOCs for fancy sh*t and fancy toys (maybe you know some cops like that, - I don't).

About a month ago I drove past a sh*tbox with a for sale sign in front. Yes indeed it was a pocket listing, already sold before the sign appeared.
at $1.025 M. You can look at the link if you like. If you don't like to look at the link, I will share some details about it:

- About 200 ft from one of "worst three" public HS in our city (out of about 50 high schools in the city). About 60 ft from a major throughfare (crime, noise, traffic). A few weeks ago a motorist ran over and killed two pedestrians who were in the crosswalk, about a half mile down the throughfare from this property.

- Built in 1959. If you look on the ®eal Estate website linked, you'll see a bit of lipstick applied to this pig. Note the sealed up former garage door. Is that former garage part of the listed 1120 sq ft living space?

- The ®eal Estate website linked says the "estimated refi payment" will be about $5300 per month. I did the arithmetic. That'd be for the monthly tax bill of over $900 plus a mortgage payment of about $4300 to service an $800k mortgage.

I suppose their $5300 includes mortgage and property tax, and little else. (like, maintenance or earthquake insurance for that pig). Using a conservative 25% housing cost $5300 per month will be an income of $22,000 per month or about $260k per year, - not allowing any money at all for maintenance or repairs or earthquake insurance. And of course there'd be the small matter of a $200,000 down payment for the buyer. Would a young cop starting out have that bit of Silicon Valley Chump Change to put down? Remember, s/he won't be getting RSUs like you and me. What do you think?

This is not an expansive McMansion for a young cop to grow a family. It is a 63 year old sh*tbox that includes a sealed off garage as living space. It is not a home in a leafy quiet neighborhood with "good schools". If s/he don't want to send kids to the worst schools in the city (see the ®eal Estate link for that property about the schools), it means Private School Tuition, easily another $20k per kid per year.

https://www.zillow.com/homedetails/1785-Hopkins-Dr-San-Jose-CA-95122/19727040_zpid/

Yes, yes, I know, your friends and my friends in SJPD "got theirs" before all this insanity. They will retire and be replaced by youngsters who will face the trade-offs. Whatever tradeoffs they choose will add to stress they'll bring with them to the job.

I am not crying for them and I am not crying for their pensions. I am pointing out that the community they serve (or don't serve) is f*cked.

It's not just a SJ problem. It's a regional problem, including leafy lily-white Tri-Valley communities. Where will their new law enforcement hires come from ?

https://www.zillow.com/homedetails/1785-Hopkins-Dr-San-Jose-CA-95122/19727040_zpid/

BayArea says

what can we do about it?

The Solution is right in front of our faces: we can leave.

Nobody put a gun to our heads and coerced us to remain living here.

It's my choice to remain for the time being. I am open minded that we may have to leave some time.

https://boriquagato.substack.com/p/the-ponzi-bomb-under-the-city-walls?triedRedirect=true

the ponzi bomb under the city walls

put there by public sector unions, it's now exploding. will it leave anything behind?

EL GATO MALO
FEB 28, 2024

those who have been paying attention, (a surprisingly small number in one gato’s opinion), have been increasingly wondering about major US cites going bankrupt. the folks at “truth in accounting” recently laid out some stark findings:

last year, 53 of the 75 most populous US cities (70%) did not have enough money to pay their bills. they held $307bn in assets and $595bn in debt, a coverage ratio of only 52% and this is probably much too optimistic as future labilities look to be being systematically reduced and future income projections look implausibly rosy, especially given how trends are going.




why is is so easy to stress a city like new york or chicago to the breaking point with a few thousand immigrants demanding housing and funding? this is why. many of these cities are teetering on the brink.

and this is going to be a huge demographic deal because when cities start to fail, people vote with their feet, the rich often voting first and hardest and that badly unbalances systems because the top 1% of taxpayers generally pay about 50% of income taxes as well as an awful lot of transaction tax and property tax. property taxes underpin a lot of city revenue so property values matter a ton. so too do business taxes, hotel taxes, etc. and if you start to erode that base meaningfully, you can suddenly find yourself with large, structural, self-reinforcing revenue holes and companies (and especially workers) have become more mobile than ever and if they do not like what’s going on in your city...

cities really do need to compete for people, especially the highly productive people and the shift from the ones that are deteriorating to the ones that are thriving seems to be picking up pace and the idea that “you need to be in SF, NYC, or LA” is falling apart for “mid and small town living is great, better for kids, and i can work from here” or “wow, austin is hoppin!” it’s shifting population patterns.

this sets up a truly nasty pincer of the people leaving and the debt staying behind to become the ever growing per capita responsibility of those left behind. this sets up a snowball effect and it has been, to date, far worse than it has appeared. this bomb is going off, people have just not noticed yet. ...

meanwhile, the value of pension payouts has been rising while the value of pension funds dropping calamitously because, of course, when rates rise, bond prices fall and this is most pronounced on the long end of the curve. when rates go from 0.1 to 4%, a 5 year zero coupon bond drops in price about 18%, but a 30 year drops about 65%. compound interest = leverage to rates.

how many municipality pension funds were buying long dated bonds looking for slightly higher yield in the yield desert of the last decade? hard to say, but either way they took some real structural hits last year. bets that rates are going back down look like bad ones. current rates are still on the lowish side of normal. it was the period from 2008 to now that was the outlier. ...

more than any other issue, pensions and retirement health plans to blame. they have become at once the most sacred of cows and the most abject horrors of short-sighted can kicking.

public sector unions that outright bribe and intimidate the very people with whom they will then have their contract negotiations are the primary culprit here. if you turn on them, your election coffers run dry and they lavish cash upon someone to unseat you and get the gravy train running on time again.

this hideous conflict of interest and bought and paid for politics would be bad enough, but demographics have made it far worse. these pension ideas were put into practice when life expectancy was 65. now it’s in the 80’s. that’s an awful lot more years of defined benefit payout. it’s become a terrible ponzi where the vast spike in payments and payees lingers for decades and thus the tax and contributor base required to cover it does too. payments in are nothing like adequate, funds get plundered and redirected, and the accounting around this has become gangrenous.

Patrick says

this hideous conflict of interest and bought and paid for politics would be bad enough, but demographics have made it far worse. these pension ideas were put into practice when life expectancy was 65. now it’s in the 80’s.

as far as solvency especially with funding public pensions, they have to hope the economy is productive and innovative so that prices do not increase more than 2.5% annually ... they can try to slowly inflate out of a debt crisis (and meet the public pension demands) with an inflation "tax" of 2.5% annually ...

states and towns will just not fund as much for discretionary spending such as parks and roads, in order to pay for their pensions , or they may require state workers to contribute more to the pension plan... FERS has done this about 10 years ago for federal employees, and I expect they'll do it again in order to ensure solvency

Booger says

Nonexistent.

There was one confined to one valley a couple of decades ago, they called out the National Guard and it took a day or so to control it.

But it was a weird Jetstream/Nino/Nina confluence that happens like once a century. Pretty rare for anywhere in the NE to go without rain for more than a couple of weeks in any season.

Patrick says

why is is so easy to stress a city like new york or chicago to the breaking point with a few thousand immigrants demanding housing and funding?

Because the grifty grafters can't pay for public services and grifty graft at the same time?

No one notices the sheer magnitude of rape/graft until the community coffers are empty. Kinda like "at first slowly, then all at once," or Alzheimer's, or cancer. At some point it needs to be extirpated, or the host dies. Grifters, like pathogens or cancer, don't care for anything except living for the moment.

I'm willing to give cops and firefighters a pass. They put their life on the line every time they show up for their shift.

I do think they need to eliminate the "load up on overtime" loophole, particularly for those close to retirement. That game has been going on for years now.

Teachers union is far stronger and provides far less value since they indoctrinated more than teach these days, at least in some areas.

That and get rid of the mid level departments that represent uncontrolled government growth.

Does each city and town need a DPW, Town Engineer, Planning Board, etc.?

Consolidate those services at the county level and save some money.